The U.S. auto industry has undergone momentous change since the federal government’s bailout of Chrysler and General Motors in 2008-09. As the industry slowly recovers, human resources directors at automakers face numerous challenges, including a penetrating demand for highly skilled workers. In particular, automakers need to accelerate their recruitment of production workers and white-collar engineers, technicians and managers – a dynamic exacerbated by a looming wave of retirements.

Handcuffed by Overcapacity

Vehicle-production capacity of the so-called Big Three U.S. automakers – General Motors, Ford and Chrysler – fell nearly 30 percent between 2004 and 2012, a drop of roughly 4 million units, according to a report by the Detroit-based Center for Automotive Research. Human resources directors apparently have had little influence in shaping how their organizations make the best use of available resources, which could help sidestep costly overproduction. Automakers for years offered consumers rebates and attractive financing to drum up sales and keep unionized workers employed at full production. These cost-driven practices often had the inverse effect, however.

Looming Retirements and Skills Shortages

Finding capable people to back-fill an exodus of retiring workers has many HR directors concerned. Employment in the auto industry has been relatively constant for decades, with few instances of hiring sprees. But that should change as older workers get ready to leave the workforce, prompting hiring managers to comb through resumes for high-tech candidates with both the technical chops and the ability to analyze and solve problems.

High-Tech Hiring Headaches

The pace of technological change ushers in new vehicle standards for fuel economy, environmental quality and safety. Automakers already are in a highly competitive business, yet Kristin Dziczek, a director with the Center for Automotive Research, wrote in the Community College Times that “the cadence of getting new products to market has become more rapid.” Operators, skilled tradespeople and technicians/engineers are the three toughest positions to fill, according to a survey of HR directors at automotive companies by Case Western Reserve University and the labor departments of Indiana, Michigan and Ohio.

Younger Workers Hard to Find

Aside from the skills shortages, HR directors must overcome the poor image young people have of manufacturing. Among people 18 to 24, “manufacturing ranks dead last among industries in which they would choose to start their careers,” according to a 2011 report from consulting firm Deloitte, done in conjunction with The Manufacturing Institute.

Demographic and Geographic Shifts

The southeastern U.S. in recent years has emerged as a popular locale for automotive production, including Alabama, Georgia, Mississippi, South Carolina, Tennessee and Virginia. Southern states offer several advantages to manufacturers, namely right-to-work laws that guarantee no worker can be compelled to join a labor union. In addition, an employee’s cost of living usually is lower in the south compared to states in the industrial Midwest. As this shift continues, HR directors are expected to recruit, develop and train workers to be technically proficient in automotive processes and technologies. This may involve recruiting people with experience in a non-automotive manufacturing environment and providing targeted training to help them make the transition.

Unionization

Automotive industry HR directors in the U.S. are not solely responsible for negotiating a collectively bargained wages-and-benefits package with labor unions, although they are involved in administering it. However, they must brace for the possibility of increased unionization – and its ramifications -- at auto plants in traditionally non-union turf.

About the Author

Garry Kranz has been writing professionally since 1986, and has experience in both print and online media. Specializing in business reporting, he has interviewed hundreds of CEOs at well-known companies, including Ford, Dupont, Aetna, Frito Lay, Comcast, Philip Morris, and many others. His work has appeared in publications by Crain Communications, Media General, Forbes and Landmark Communications.